A Celebration – Continued

Yesterday we began celebrating some of the truly stupid business moves of 2009, as brought to you by Fortune Magazine and CNN. It seems a shame to kick all of these people while they’re down, but on the other hand there are some actions so asinine, and so completely to the contrary of the public good, that they bear repeating. And I don’t know where you’d find a better example of that than South Carolina’s Governor, Mark Sanford …

By now you probably already know Sanford from his South American holiday and the associated massive hypocrisy, but had that story not broken he’d probably still have gone down in infamy as one of a few Republican governors who attempted to refuse the Obama Administration’s stimulus money. In fact, Sanford intended to demonstrate his commitment to his conservative fiscal beliefs by refusing $700 million in Federal aid, thus depriving the state with the second-highest unemployment in the country of any of the public works projects you could fund with that money, as well as the jobs that would be associated with them. Several other Republican governors, notably Sarah Palin of Alaska, also attempted to reject the Federal assistance, but in Sanford’s case the South Caroline Supreme Court ruled against the Governor and ordered him to accept the money. The combination was a political black eye that would likely have finished Sanford’s career if the whole infidelity matter hadn’t wiped it out of the public eye…

I’ve already noted that attempting to use the Hoover Administration’s approach to an economic crisis (running around the Oval Office making little shrieking noises) is part of what did in the Republicans in last year’s Presidential elections, and we can only hope that any other governors (Republican OR Democrat) who try it meet a similar fate. Even if such a move was economically correct (which is clearly dubious, at best) this is a public relations blunder so completely inept that if it wasn’t for Willie Walsh, CEO of British Airways, I wouldn’t even have anything to compare it to. For the record, Mr. Walsh is the executive who asked all of his personnel to work for 40 days this year without pay in order to save the company from bankruptcy, saying that he would himself not take a salary for July (and presumably 9 other days this year). The gesture fell flat, however, since Mr. Walsh received a 6% pay raise for this year and will still make in excess of $1 million even if he does take 40 unpaid days (and made $1.2 million last year); the general feeling among the airline employees is that he can afford it…

But I think the top honors have to go to the folks at AIG, who insisted on granting $165 million in annual bonuses to the people who had tanked their company and forced the Federal Government to bail them out for over $150 billion – on the grounds of needing to retain those people. As I noted in an earlier post, even if all of those people really were critical to running the company (and pulling it out of the mess it was in), and despite the fact that all of the bonuses together didn’t amount to even 0.2% of the Federal bailout money, this was a PR disaster that made AIG eclipse Halliburton as the most hated organization in America; a feat I would have said was impossible just a year earlier. Moreover, since financial services are a relationship-based business, I fail to see how AIG will ever recover from annoying all of its customers to this extent…

I’d call these posts high comedy, and suggest that we all needed a good laugh, except for two rather troubling facts. First, most of the people responsible for these idiot plays are still in place, and likely to continue planning strategy for these same organizations. And second, it’s only July. The year’s not over yet…